[Federal Register Volume 85, Number 145 (Tuesday, July 28, 2020)]
[Rules and Regulations]
[Pages 45303-45306]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-15412]
========================================================================
Rules and Regulations
Federal Register
________________________________________________________________________
This section of the FEDERAL REGISTER contains regulatory documents
having general applicability and legal effect, most of which are keyed
to and codified in the Code of Federal Regulations, which is published
under 50 titles pursuant to 44 U.S.C. 1510.
The Code of Federal Regulations is sold by the Superintendent of Documents.
========================================================================
Federal Register / Vol. 85 , No. 145 / Tuesday, July 28, 2020 / Rules
and Regulations
[[Page 45303]]
DEPARTMENT OF AGRICULTURE
Agricultural Marketing Service
7 CFR Part 1200
[Doc. No. AMS-SC-19-0105]
Administrative Procedures Governing Formulation of a Research and
Promotion Order
AGENCY: Agricultural Marketing Service, Agriculture (USDA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: This rule establishes procedures to govern the formulation of
new research and promotion programs--or orders--under the Commodity
Promotion, Research, and Information Act of 1996 (Act). Research and
promotion programs are administered by boards or councils with
oversight by the United States Department of Agriculture (USDA). This
rule specifies the process for proposing such programs to USDA. It also
clarifies that USDA's Agricultural Marketing Service (AMS) will
continue to require associations of producers or individuals proposing
new programs to post a bond or other collateral to reimburse USDA for
the costs of program development.
DATES: Effective date: August 27, 2020.
FOR FURTHER INFORMATION CONTACT: Heather Pichelman, Promotion and
Economics Division, Specialty Crops Program, AMS, USDA, 1400
Independence Avenue SW, Room 1406-S, Stop 0244, Washington, DC 20250-
0244; telephone: (202) 720-9915; facsimile: (202) 205-2800; or
electronic mail: [email protected].
SUPPLEMENTARY INFORMATION: As authorized under the Act, this final rule
adds a new subpart D to 7 CFR part 1200--Rules of Practice and
Procedure Governing Proceedings Under Research, Promotion, and
Information Programs. Subpart D addresses procedures specific to the
formulation of new programs under the Act.
Executive Orders 12866, 13563, and 13771
Executive Orders 12866 and 13563 direct agencies to assess all
costs and benefits of available regulatory alternatives and, if
regulation is necessary, to select regulatory approaches that maximize
net benefits (including potential economic, environmental, public
health, and safety effects; distributive impacts; and equity).
Executive Order 13563 emphasizes the importance of quantifying both
costs and benefits, reducing costs, harmonizing rules, and promoting
flexibility. This action falls within a category of regulatory actions
that the Office of Management and Budget (OMB) exempted from Executive
Order 12866 review. Additionally, because this rule does not meet the
definition of a significant regulatory action, it does not trigger the
requirements contained in Executive Order 13771. See OMB's Memorandum
titled ``Interim Guidance Implementing Section 2 of the Executive Order
of January 30, 2017, titled `Reducing Regulation and Controlling
Regulatory Costs' '' (February 2, 2017).
Executive Order 13175
This action has been reviewed in accordance with the requirements
of Executive Order 13175, Consultation and Coordination with Indian
Tribal Governments. The review reveals that this regulation would not
have substantial and direct effects on Tribal governments and would not
have significant Tribal implications.
Executive Order 12988
This rule has been reviewed under Executive Order 12988, Civil
Justice Reform. It is not intended to have retroactive effect. 7 U.S.C.
7423 provides that the Act shall not affect or preempt any other
Federal or State law authorizing promotion or research relating to an
agricultural commodity.
Background
This final rule establishes procedures to govern the formulation of
new research and promotion programs under the Act. This rule also
clarifies that AMS will continue to require associations of producers
or individuals proposing new programs to post a bond or other
collateral to reimburse USDA for the costs of program development.
Title 7 U.S.C. 7413(b)(1)(B) authorizes associations of producers
of an agricultural commodity or other individuals to petition USDA to
establish a research, promotion, and/or information program with
respect to that commodity. The purpose of such programs is to provide a
framework for agricultural industries to pool their resources and
combine efforts to develop new markets, strengthen existing markets,
and conduct important research and promotion activities. See 7 U.S.C.
7411(b).
USDA's Agricultural Marketing Service (AMS) oversees these
programs. With this final rule, AMS is establishing the following
procedures for formulating new programs so interested parties are aware
of the process and requirements.
Under Sec. 1200.202(a), an industry association or individuals may
file a written proposal for a new research and promotion program with
the AMS Administrator (Administrator). Under Sec. 1200.202(b), the
Administrator will consider whether there is broad industry support for
the proposed program and whether proposed provisions of the program are
authorized under the Act. The Administrator will also evaluate
anticipated benefits to the industry and the economic feasibility of
the program. Finally, the Administrator will consider whether the
proposed program would tend to effectuate the declared policy of the
Act. Under Sec. 1200.202(c), if the Administrator determined that the
program will not effectuate the policy of the Act, AMS will deny the
proposal and would notify the proponent(s), explaining the grounds for
denial. Under Sec. 1200.202(d), if the Administrator determined that
the proposed program will likely effectuate the purposes of the Act by
benefitting producers, handlers, and importers of the commodity, or
others in the marketing chain, the Administrator will notify the
proponent(s) that AMS will proceed with program development and, in
accordance with Sec. 1200.204, the proponent(s) will be required to
post a bond or other collateral to cover AMS expenses to develop the
program.
The Act provides that once a board is established under an order,
the Secretary of Agriculture (Secretary) must be reimbursed for all
expenses incurred in the implementation,
[[Page 45304]]
administration, and supervision of the order, including all referenda
costs incurred in connection with the order. The board uses assessment
funds collected from regulated entities to reimburse the Secretary for
program oversight.
However, AMS incurs substantial expenses in the development process
leading to program establishment. AMS may conduct industry outreach
meetings, solicit public input, analyze economic data, draft rulemaking
documents, and conduct initial referenda. These activities are
necessary to progress toward program establishment. Typical expenses
for these preliminary activities may include, but not be limited to,
employee time and travel, supplies, printing, and mailing.
In some cases, the proponent industry may elect to defer an initial
referendum for up to three years after the program is established. In
other cases, despite all efforts of the proponent and AMS to develop a
new program, ultimately the proposed program may not be established.
Nevertheless, under either of these scenarios, AMS will have already
incurred expenses related to program development.
Section 7417(a)(2) of the Act provides that the Secretary can
require the industry seeking a new program to post a bond or other
collateral to cover the cost of the initial referendum. In Sec.
1200.201, this rule defines cost of the referendum to mean all the
expenses AMS incurs in the development of a potential new program,
including the cost of conducting an initial referendum.
The amount of the bond or collateral required under Sec. 1200.204
will be based on unique factors like the projected number of staff
hours involved, the amount of staff travel necessary for outreach, the
size and complexity of the proposed program, and the number of industry
members to be polled in an initial referendum. This will ensure that
AMS will be reimbursed on a timely basis for all expenses related to
program development, even if the initial referendum is deferred or if
the program is not established.
Section 1200.202(e) of this rule specifies that once AMS has worked
with industries or individuals to develop a proposed order, AMS will
publish the proposal in the Federal Register to allow public comments
on the proposed program. Based on comments, AMS will determine whether
to proceed with program establishment.
Under Sec. 1200.203 of this rule, if AMS determined to proceed
with program establishment, the Administrator could conduct an initial
referendum among the producers, handlers, and importers who would be
subject to assessment under the program in order to determine whether
they favor establishment of the program. The Act provides that USDA
could also establish the program and defer the initial referendum for
up to three years after the program is established. See 7 U.S.C.
7417(b). In either case, referendum voters will be those entities who,
during a representative period determined by the Administrator,
produced, handled, and/or imported the agricultural commodity. For
referendum expenses incurred after a program is established, the
Secretary will be reimbursed by the board appointed to administer the
program, as provided by the Act. See 7 U.S.C. 7417(f).
Under Sec. 1200.205 of this rule, if at any time during the
development process, based on public comments, referendum votes, or
other information available, AMS determines that the proposed program
will not tend to effectuate the policy of the Act, the Administrator
will terminate proceedings and will collect reimbursement for program
development expenses from the bond or collateral posted by the program
proponent(s).
This rule will also make other administrative provisions related to
the establishment of a new program. Section 1200.201 will define other
terms necessary for administration of the regulation. Section 1200.206
will provide for the issuance, effectuation, and publication of the new
order.
Final Regulatory Flexibility Act Analysis
The Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612) requires
agencies to consider the economic impact of each rule on small
entities. The purpose of the RFA is to fit regulatory actions to the
scale of businesses subject to such actions so that small businesses
will not be disproportionately burdened. The purpose of research and
promotion programs is to benefit all sizes of producers, handlers, and
importers of an agricultural commodity.
The Act makes it possible for producer associations or other
individuals engaged in specific agricultural commodity industries to
submit a proposal for a new program. It is impossible for AMS to
determine which industries may seek research and promotion programs in
the future or to determine the number or size of business entities that
might propose such programs. The expenses necessary for each program's
development depend on factors such as projected staff hours to develop
the program, travel expenses related to outreach, size and complexity
of the proposed program, and the size of the industry to be polled in a
referendum. Based on its experience with past program proposals, AMS
estimates that expenses for typical program development range from
$80,000 to $150,000. Thus, under this rule, proponents could be
required to post bonds or other collateral to cover those amounts if
AMS agrees to proceed with program development. Costs to individuals or
businesses will depend on the number of entities in each proponent
group. Given that we don't know the identity or business size of future
program proponents, AMS cannot determine what economic impact this rule
might have on small entities. Based on experience with proponents
seeking to establish new programs under the Act, AMS believes that this
rule is unlikely to have a significant economic impact on a substantial
number of small entities.
There will be no new direct costs associated with the
implementation of this rule. This rule codifies procedures for
proposing new research and promotion programs that have been practiced
since the Act's adoption in 1996. In addition to specifying the program
proposal process, the rule clarifies that the cost of the referendum to
be covered by the required bond or collateral would include all the
costs associated with program development.
Paperwork Reduction Act
No information collection or recordkeeping requirements are imposed
on the public by this rule. Accordingly, OMB clearance is not required
by the Paperwork Reduction Act of 1995, 44 U.S.C. 3501, Chapter 35.
As with all Federal research and promotion programs, reports and
forms are periodically reviewed to reduce information requirements and
duplication by industry and public sector agencies.
E-Government Act
AMS is committed to complying with the E-Government Act, to promote
the use of the internet and other information technologies to provide
increased opportunities for citizen access to Government information
and services, and for other purposes.
A proposed rule concerning this action was published in the Federal
Register on April 27, 2020 (85 FR 23246). A 30-day comment period
ending on May 27, 2020, was provided to allow interested persons to
respond to the proposal. The proposal was also
[[Page 45305]]
made available through the internet by USDA and the Office of the
Federal Register.
Analysis of Comments
Two comments were received in response to the proposed rule. Of
those comments, only one was substantive and related to this proposed
rule. This commenter expressed a concern about the proposal. The
commenter called the proposed rule a ridiculous idea.
AMS initiated this rule because it incurs substantial expenses in
the development process leading to program establishment. The Act
already requires the Secretary to be reimbursed for all expenses
incurred in the implementation, administration, and supervision of the
order, including all referenda costs incurred in connection with the
order after a board has been established. This rule added expenses AMS
incurs to develop a program to this requirement.
AMS has been requiring associations of producers or individuals
proposing new programs to post a bond or other collateral to reimburse
USDA for the costs of program development. This rule codifies this
procedure, along with others, for proposing new research and promotion
programs. These procedures have been practiced since the Act's adoption
in 1996. Therefore, no changes have been made to this rule based on the
comment.
A definition of ``Secretary'' has been added to the Definitions
section to provide clarity.
After consideration of all relevant matters presented, including
the information and recommendation submitted by the Board, the comments
received, and other relevant information, it is hereby found that this
rule, as hereinafter set forth, is consistent with and would effectuate
the purposes of the Act.
List of Subjects in 7 CFR Part 1200
Administrative practice and procedure, Agricultural research,
Reporting and recordkeeping requirements.
For the reasons set forth in the preamble, AMS amends 7 CFR part
1200 as follows:
PART 1200--RULES OF PRACTICE AND PROCEDURE GOVERNING PROCEEDINGS
UNDER RESEARCH, PROMOTION, AND INFORMATION PROGRAMS
0
1. The authority citation for part 1200 continues to read as follows:
Authority: 7 U.S.C. 2101-2119, 2611-2627, 2701-2718, 2901-2911,
4501-4514, 4801-4819, 4901-4916, 6101-6112, 6301-6311, 6401-6417,
7411-7425, 7481-7491, and 7801-7813.
0
2. Add subpart D, consisting of Sec. Sec. 1200.200 through 1200.206,
to read as follows:
Subpart D--Administrative Procedures Governing Formulation of a
Research and Promotion Order
Sec.
1200.200 General.
1200.201 Definitions.
1200.202 Proposals.
1200.203 Initial referendum.
1200.204 Reimbursement of Secretary's expenses.
1200.205 Termination of proceedings.
1200.206 Execution of the order.
Authority: 7 U.S.C. 7411-7425.
Sec. 1200.200 General.
The terms defined/specified in this subpart shall apply to all
research and promotion programs authorized under the Act.
Sec. 1200.201 Definitions.
Act means the Commodity Research, Promotion, and Information Act of
1996 (7 U.S.C. 7411-7425).
Administrator means the Administrator of the Agricultural Marketing
Service or any officer or employee of the United States Department of
Agriculture to whom authority has been delegated or may hereafter be
delegated to act for the Administrator.
Cost of the Referendum means all USDA expenditures related to
development of an order proposal, including, but not limited to,
salaries, travel, supplies, printing, mailing, and shipping, and any
costs related to an initial referendum.
Order means any order which may be issued pursuant to the Act.
Secretary means the United States Secretary of Agriculture or any
officer or employee of the United States Department of Agriculture to
whom authority has been delegated or may hereafter be delegated to act
for the Secretary.
Sec. 1200.202 Proposals.
(a) An order may be proposed by any association of producers of an
agricultural commodity, by any person that may be affected by the
issuance of an order with respect to an agricultural commodity, or by
the Secretary. Any person or organization other than the Secretary
proposing an order shall file with the Administrator a written
proposal.
(b) Upon receipt of a proposal, the Administrator shall investigate
and evaluate the proposal.
(c) If the proposal is submitted by an association of producers of
the agricultural commodity or by any person that may be affected by the
issuance of an order, and the investigation and consideration lead the
Administrator to conclude that the proposed order will not tend to
effectuate the declared policy of the Act, the Administrator shall deny
the proposal. The Administrator will promptly notify the proponent(s)
of such denial, which will be accompanied by a brief statement of the
grounds for the denial.
(d) If the proposal was submitted by an association of producers of
the agricultural commodity or by any person that may be affected by the
issuance of an order and the investigation and consideration lead the
Administrator to conclude that an order will tend to effectuate the
declared policy of the Act, the Administrator will promptly notify the
proponent(s) of such conclusion, and the proponent(s) will be required
to post a bond or other collateral in accordance with Sec. 1200.204.
(e) If the Administrator concludes that an order will tend to
effectuate the declared policy of the Act, the Administrator shall
publish the proposed order in the Federal Register and give due notice
and opportunity for public comment on the proposed order.
Sec. 1200.203 Initial referendum.
For the purpose of ascertaining whether the persons to be covered
by an order favor the order going into effect, the Administrator may
conduct an initial referendum among persons to be subject to an
assessment under the order who, during a representative period
determined by the Administrator, engaged in the production or handling
of the agricultural commodity or the importation of the agricultural
commodity.
Sec. 1200.204 Reimbursement of Secretary's expenses.
The Administrator may require any person or organization proposing
an order to post a bond or other collateral to cover the cost of the
referendum as defined in Sec. 1200.201.
Sec. 1200.205 Termination of proceedings.
If at any time during development of a new program the
Administrator concludes, based on public comments, referendum votes, or
other available information, that an order will not tend to effectuate
the declared policy of the Act, the Administrator shall terminate the
proceedings and collect reimbursements from the bond or other
[[Page 45306]]
collateral posted pursuant to Sec. 1200.204 for any expenses incurred
in development of the proposed program.
Sec. 1200.206 Execution of the order.
(a) Issuance of the order. The Administrator shall, if the
Administrator finds that it will tend to effectuate the purposes of the
Act, issue the final order.
(b) Effective date of order. No order shall become effective in
less than 30 days after its publication in the Federal Register, unless
the Administrator, upon good cause found and published with the order,
fixes an earlier effective date.
(c) Notice of issuance. After the Administrator issues the order,
AMS will publish notice of the order's issuance in the Federal
Register.
Bruce Summers,
Administrator, Agricultural Marketing Service.
[FR Doc. 2020-15412 Filed 7-27-20; 8:45 am]
BILLING CODE P